01/10/20: Cynopsis Live from CES 01/10/20

 

A CYNOPSIS MESSAGE FROM HULU

 

Cynopsis Long Story Short
Friday January 10, 2020

Discovery digital chief Karen Leever talks D2C, HBO Max says its price point is right on the money, and Conde Nast says digital’s driving… wait for it… print subscriptions. It’s Friday, January 10, 2020 and this is your daily Cynopsis dispatch from CES.

IN THE NEWS

Is $14.99/month too high a price tag for impending streaming service HBO Max? Sean Kisker, chief strategy officer at WarnerMedia direct to consumer, unsurprisingly thinks not. Here’s why: “In terms of justifying, the way to think about it is that $14.99 is the price people pay for just HBO today, and HBO Max is more than doubling the amount of content,” he said on a CES panel. “There will be a substantial swath of content” ranging from Warner Bros. library titles to HBO fare. “If you look at it in the aggregate, it’s a real value proposition. At Disney+, their goal is not to be a general entertainment service. They’re not offering that same thing.” Kisker said WarnerMedia’s priority is capturing SVOD subscribers. “As the paid television ecosystem begins to evolve, the idea of a winner take all scenario is not what’s going to happen, but as dollars and viewer begin to migrate, there will be a premium on some services over others,” he said.

Speaking of subscriptions, a recent Conde Nast Entertainment test saw a strong uptick in magazine subs, and it’s not even throwback Thursday. CNE president Oren Katzeff told a CES audience the company’s using video to develop and extend audiences for some of its print brands and in early testing, the digital extension drove up print subscriptions. CNE created short-form content based around legacy brand Bon Appetit. “We had a campaign that started in the magazine, went to digital, and within the video we were promoting magazine subscriptions,” he said. “And we had one of our best-ever subscription days for print on the day we launched the video,” Katzeff said. He cited the New Yorker as one of the company’s strongest print brands.

A CYNOPSIS MESSAGE FROM HULU

 

Taking it personally: Video personalization has been at the heart of many a CES convo. “It’s all about being relevant and leveraging data to create a personalized customer ad experience with a call to action that is in tune with the consumer,” said Oz Etzioni, CEO of Clinch, a real-time personalized programmatic creative platform. “Many marketers talk a big personalization game—but relevancy ultimately determines effectiveness.” Etzioni said personalization begins with making sense out of all the data being collected, then using that data to communicate to targeted audiences in a way that will turn them into loyal consumers: “When the experience is repetitive and doesn’t ‘learn’ from past user interaction/engagement, consumers take notice. There have never been more ways to leverage data to develop real consumer connections. There is a tremendous opportunity for brands to combine these findings with the power of video to increase conversions online. The brands that truly integrate data into their creative experience will be the winners in 2020.”

Podcasting, it’s not just for a one-and-done listen. At least not according to Dawn Ostroff, former Conde Nast digital exec who last year joined Spotify as chief content officer. At CES, Ostroff said the audio format has a big role to play in brand- and IP-building. “It’s another way to have a pillar that is significant in building a brand,” she said, acknowledging Spotify’s push into advertising and plans to “really elevate” that line of business.

ADVERTISING + BRANDS:

OTT is the next wave of local advertising, Aman Sareen, CEO of ZypMedia, told Cynopsis. “Local advertisers are starting to understand the value OTT brings to the table, as traditional linear TV viewing shifts to digital video across all screens. OTT augments their strategies to reach valuable audiences, now and in the future. In order to meet this demand, local advertisers will have to increase their use of OTT and leverage their local media partners’ audience data to discover shifting viewing behaviors, as well as supplement their linear campaigns,” Sareen said. “The growth of AVOD and access to free content is an excellent way to reach audiences on this platform. OTT provides the best of both worlds for local advertisers, including reach, brand safe environment, and the premium content that television offers with the benefits of digital targeting and reporting that comes from OTT. Because of the digital nature of OTT, real-time reporting throughout the campaign gives local advertisers the transparency to pivot and refine results, providing the best return on their ad spend.”

A CYNOPSIS MESSAGE FROM HULU

 

EXCLUSIVE INTERVIEW: KAREN LEEVER, DISCOVERY

Discovery is immersed in direct to consumer video offerings, and Karen Leever, president of US digital products and marketing, is at the helm of it all, from the newly launched Food Network Kitchen to Discovery Factual to the MotorTrend app to content associated with the upcoming Chip & Joanna Gaines service. Leever spoke on the CES panel Internet TV and OTT: Programming Everywhere, and Cynopsis caught up with her off the show floor for a deeper dive.

Discovery is immersed in niche OTT services. How does this strategy differ from the deluge of general entertainment services?
KL: We feel very positive about our D2C strategy. We own passion verticals like home, food, auto, sports, etc., that consumers really love, and we are excited to go deep into those areas. We own all of our content, which gives us a lot of options in terms of how we deliver it to the consumer. Between our 18 US networks, we generate roughly 8,000 hours of original content every year and also have a deep library of titles. It’s a huge competitive advantage. We also have the opportunity to go beyond just “viewing” and develop robust services in addition to streaming video, giving the consumer fun ways to further immerse themselves into these genres.

We’d love to hear your thoughts on pricing: Subscription vs. ad-supported vs. a la carte?
KL: We have a very successful AVOD product, which is our suite of streaming TV everywhere Go apps. They give pay TV subscribers more than 60,000 episodes across our networks. Our Food Network Kitchen and Motor Trend apps are subscription supported. They are priced competitively and those services give consumers a mix of premium network content, as well as original programming and experiences, like Food Network Kitchen’s interactive cooking classes, that can’t be found anywhere else. So, I think to succeed you really need to have a mix and provide the consumer with a product that they can’t live without.

What’s challenging about a business model grounded in the niche OTT space?
KL: I think the number one thing to consider when launching any type of new product is brand awareness. People are consuming more content on more platforms than ever before and they have so many options available to them. Through our brands and beloved personalities, we are driving deep connections with our fans, some of whom have been with us for decades. We are taking that engagement and leveraging it in our D2C products. In terms of brand awareness, at Discovery, we are incredibly lucky in that we have a built-in distribution model via our 18 US networks. They allow us to talk to our consumers directly and target the right product to the right consumer.

How is tech aiding the business of Discovery’s OTT services?
KL: Technology is a massive focus for Discovery. We are laser-focused on building industry-leading capabilities and proprietary technology. In the past year we have built a robust engineering and tech team helmed by our CEO of direct-to-consumer, Peter Faricy, who joined us last year from Amazon. He and his team have built a global platform that will allow us to launch multiple OTT services and run our existing ones with ease. Owning and operating our own tech architecture is a huge competitive advantage and one that should allow us to further scale opportunities across multiple verticals.

A CYNOPSIS MESSAGE FROM HULU

 

Vegas doesn’t sleep, and neither does Cynopsis when we’re covering CES for you. If you have news to share as the show comes to a close, please hit me up at Cathy@Cynopsis.com.

Cheers,
Cathy Applefeld Olson

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